Beyond Fighting Disease: Effects of Aid from the Global Fund on Governance and Development

By Matthew M. Kavanagh, PhD & Lixue Chen

Working Paper

The Global Fund to Fight AIDS, Tuberculosis and Malaria has proven highly effective at fighting the world’s major killers. Strong governance and development institutions, however, are necessary for improving health long-term. While some suggest international aid can strengthen institutions, others worry “dead” aid undermines governance. The Fund is a unique aid institution with mechanisms designed to improve transparency and accountability. We constructed a unique dataset to explore whether Global Fund financing has a significant effect on governance and development. We find evidence that, in the course of fighting disease, the Fund has improved governance and national development. Controlling for multiple factors, including the effects of other aid, we find Global Fund support improves control of corruption, government accountability, political freedoms, regulatory quality, and rule of law, though no significant effect on effective policy implementation. We also found benefit for overall adult mortality and human development.